Another off-price retailer has posted strong results for its third quarter.
Ross Stores reported that its net earnings grew to $371 million, or $1.03 per share, in the quarter ended Nov. 2, up from $338 million and earnings per share of $0.91 in the year-ago period. Analysts had expected earnings of $0.98.
Third-quarter sales rose 8% to $3.8 billion. Same-store sales rose 5%, easily topping Street expectations, on top of last year’s gain of 3%.
Ross reported its results just days after another off-price retailer, The TJX Cos., posted robust numbers.
“We are pleased that our third-quarter results were ahead of expectations,” said Barbara Rentler, CEO. “Operating margin of 12.4% was also above-plan mainly due to better than expected sales and merchandise margin.”
Rentler sounded a cautious note about holiday sales, noting the chain was up against multiple years of strong comparable store sales gains.
“In addition, we expect another fiercely competitive retail landscape, along with ongoing uncertainty surrounding the macro-economic and political environment,” she said. “As such, while we hope to do better, we continue to project fourth quarter comparable store sales gains of 1% to 2% versus a 4% increase last year.”
The retailer also continues to expect fourth quarter earnings per share to be in the range of $1.20 to $1.25, which now includes a one-time, non-cash benefit of $.02 per share, primarily due to the favorable resolution of a tax matter, offset by slightly higher pre-tax expenses.
“Based on our year-to-date results, and our updated fourth quarter guidance, we are now planning earnings per share for fiscal 2019 to be in the range of $4.52 to $4.57, up from $4.26 in fiscal 2018,” Rentler said.
Ross operates 1,550 Ross Dress for Less stores in 39 states, the District of Columbia, and Guam. It also operates 260 dd’s Discounts locations in 19 states.